Here’s the Report That May Have Prompted The Lumber Liquidators Raid

Last month’s raid on Lumber Liquidators by federal authorities appears to have its roots in research by an environmental activist group.

The Washington-based group, which has the official-sounding name Environmental Investigation Agency, spent three years digging up what it says is evidence the discount flooring retailer knowingly bought millions of square feet of oak and birch wood that originated in protected forests in far eastern Russia through a Chinese-owned supplier.

The environmental group said it provided its findings to federal authorities ahead of the government raid. Its report is available as a PDF here.

Lumber Liquidators’ headquarters in Toano, Va., and another location in Richmond were raided last month by special agents from the Immigration and Customs Enforcement’s Homeland Security Investigations unit, together with the U.S. Fish and Wildlife Service and the Justice Department.

The agents were looking for evidence the company had imported wood products from forests in far eastern Russia that are home to the endangered Siberian tiger, a person familiar with the matter said.

Such evidence could help demonstrate violations of the Lacey Act, a federal conservation statute that makes it illegal to import or sell fish, wildlife or plants if it violates state or foreign law. The act—which carries criminal penalties of up to $500,000 per violation—was amended in 2008 to include wood types to curb illegal logging.

ICE has said no arrests were made and has declined to say whether any items were removed from either location. The investigation’s affidavit and search warrants were sealed. A spokesman for ICE, who had been furloughed due to the unresolved dispute in Washington over funding the government, couldn’t be reached Tuesday.

In its investigation, the nonprofit Environmental Investigation Agency said it traveled to the Russian saw mills of one of Lumber Liquidators’ longtime Chinese suppliers, the Suifenhe Xingjia Economic and Trade Co. The nonprofit posed as potential buyers and secretly videotaped conversations with Xingjia executives.

The group says executives were open about their extensive use of illegal logging to provide Western retailers with cheap quality wood products. The group said the Chinese executives said Lumber Liquidators knew that some of the wood comes from illegal sources.

The nonprofit also photographed pallets of wood products labeled Virginia Mill Works — a Lumber Liquidators house brand — and tracked their arrival through U.S., Chinese and Russian customs records.

Shipping records show Xingjia is indeed a supplier to Lumber Liquidators, but the allegations couldn’t be independently confirmed. Xingjia executives diidn’t immediately respond to requests for comment Tuesday.

A Lumber Liquidators spokeswoman said Tuesday that the company hadn’t seen the report from the Environmental Investigations Agency so it couldn’t comment on its contents.

The hardwood retailer “has policies and procedures in place for the sourcing, harvesting and manufacturing of all its products, monitored by professionals located around the world,” spokeswoman Leigh Parrish said. “The company invests significant time and resources to safeguard quality control and compliance.”

Conservation groups say forests in Russia’s far east are known for large scale illegal cutting operations. Illegal logging brigades comb forests for high-quality varieties like Mongolian oak and Korean pine, cutting down trees in the middle of the night and passing them along to illegal saw mills. From there, traders mix the illegal wood with legal wood and Chinese manufacturers use fake documentation to smuggle so-called black wood out of Russia to sell to Western retailers.

Much of the logging in the Russian far east takes place in the natural habitat of the Siberian tiger, of which there are only about 450 left in the world.

The logging reduces the supply of acorns and pine nuts available to red deer and wild boars, which make up the tiger’s food supply.

Companies have come under increasing pressure to police supply chains to ensure they aren’t selling wood products made from lumber that was obtained illegally.

Comments (5 of 5)

It is very delicate that consumers go for lower prices without taking into account -or knowing- that the product they are buying comes at a way larger cost. The cost of finally whiping out this exquisite species.

8:24 pm November 18, 2013

Liquidators Maitland wrote:

This article is very sensitive. We gather another information about liquidation. Thank you for sharing this kind of article to the viewers.

12:00 pm October 9, 2013

Guest wrote:

The company is violating all the norms. They are cheating for long time may be for 4-5 yrs. This is going on, the day they bought Chinese Supplier.